Discounted Cash Flow (DCF) Analysis Levered

Verizon Communications Inc. (VZ)

$37.66

+0.29 (+0.78%)
All numbers are in Millions, Currency in USD
Stock DCF: 117.34 | 37.66 | undervalue

Free Cash Flow

Year
A/P
2018
Actual
2019
Actual
2020
Actual
2021
Actual
2022
Actual
2023
Projected
2024
Projected
2025
Projected
2026
Projected
2027
Projected
Revenue 130,863131,868128,292133,613136,835138,413.80140,010.81141,626.25143,260.33144,913.27
Revenue (%)
Operating Cash Flow 34,33935,74641,76839,53937,14139,486.6639,942.2640,403.1140,869.2841,340.83
Operating Cash Flow (%)
Capital Expenditure -18,087-18,837-20,318-67,882-26,740-31,638.65-32,003.70-32,372.96-32,746.47-33,124.30
Capital Expenditure (%)
Free Cash Flow 16,25216,90921,450-28,34310,4017,848.017,938.568,030.158,122.818,216.53

Weighted Average Cost Of Capital

Share price $ 37.66
Beta 0.335
Diluted Shares Outstanding 4,150
Cost of Debt
Tax Rate 24.81
After-tax Cost of Debt 1.54%
Risk-Free Rate
Market Risk Premium
Cost of Equity 4.963
Total Debt 176,331
Total Equity 156,289
Total Capital 332,620
Debt Weighting 53.01
Equity Weighting 46.99
Wacc

Build Up Free Cash Flow

Year
A/P
2018
Actual
2019
Actual
2020
Actual
2021
Actual
2022
Actual
2023
Projected
2024
Projected
2025
Projected
2026
Projected
2027
Projected
Revenue 130,863131,868128,292133,613136,835138,413.80140,010.81141,626.25143,260.33144,913.27
Operating Cash Flow 34,33935,74641,76839,53937,14139,486.6639,942.2640,403.1140,869.2841,340.83
Capital Expenditure -18,087-18,837-20,318-67,882-26,740-31,638.65-32,003.70-32,372.96-32,746.47-33,124.30
Free Cash Flow 16,25216,90921,450-28,34310,4017,848.017,938.568,030.158,122.818,216.53
WACC
PV LFCF 7,150.757,012.376,876.666,743.586,613.08
SUM PV LFCF 36,597.55

Terminal Value

Growth in perpetuity method:
Long-term growth rate
WACC (%) 3.15
Free cash flow (t + 1) 8,380.86
Terminal Value 728,770.10
Present Value of Terminal Value 624,085.92

Intrinsic Value

Enterprise Value 660,683.47
Net Debt 173,726
Equity Value 486,957.47
Shares Outstanding 4,150
Equity Value Per Share 117.34